In the early 1950s a
collection of essays was published in a single book titled "The
God That Failed". The "god" being referred to was
Soviet Communism and the authors were disillusioned former Communist
enthusiasts whose god had been tried and found severely flawed. Now, a
half century later, Hans Hermann Hoppe provides a penetrating critique of
another failed political idol. Hoppe's "Democracy:
The God That Failed – The Economics and Politics of Monarchy, Democracy
and Natural Order" (Transaction Publishers, 2001) may well be
the most important book on political philosophy to emerge in the last
century and may eventually mark the initiation of a whole new era in
political thought. If Hoppe's thesis is correct, and he argues his case
quite persuasively, then he has revolutionized modern political philosophy
in a manner approaching Copernican dimensions.

A native of Germany and a
professor of economics at the University of Nevada at Las Vegas, Hoppe
continues in the school of "Austrian" economics developed by
Ludwig von Mises and his student, Murray N. Rothbard. Mises is probably
best known for his critique of state socialist schemes for centralized
economic planning arguing that such endeavors are literally scientifically
impossible as they contain no mechanism (such as the pricing system of the
market) by which consumer demand can be effectively calculated thereby
guaranteeing that such plans are destined to be wasteful, inefficient
failures with shortages of essential goods, overproduction in other areas,
a demoralized, unproductive workforce, long-term economic stagnation and
eventual economic collapse. Mises resisted the near universal enthusiasms
for Marxism and social democracy of his era and clung steadfastly to the
classical liberalism and utilitarianism that had emerged in the eighteenth
and nineteenth centuries.

Mises' pupil Rothbard
took things a bit further, synthesizing Austrian economics with nineteenth
century American individualist anarchism and rejecting utilitarianism in
favor of a type of revised Lockean natural law theory from which he
derived a position that insisted upon absolute individual private property
rights (largely defined according to the Lockean "first discovery/mix
with labor" principle). Whereas Mises had accepted conventional
parliamentary democracy as a form of government, Rothbard rejected the
state entirely insisting that even such functions as crime control, courts
and defense could be provided by competing private agencies operating on a
free market. While Rothbard rejected liberal democracy, he tended to
regard it as an advancement over the monarchical and aristocratic systems
of the Old Order.

Not so, says Hoppe.
Instead, democracy is dismissed as a degeneration towards even greater
centralization, statism, tyranny and societal destruction. Hoppe
recognizes that the overall standard of living and life expectancy has
risen during the time that democracy has been commonplace but insists that
this is in spite of rather than because of the advent of democratic state
systems. Improvements in the overall human condition have instead been the
result of the growth of the market economy, the division of labor,
industrialization, technological advancement, higher productivity, etc.
Democracy has contributed to none of this in Hoppe's view. To the
contrary, democracy has been an obstacle to continued economic improvement
which might have been even greater had not democratic states been in the
way. Hoppe describes the history of Western political systems as moving
from the comparatively stateless feudal order and independent territories
to consolidated nation-states and absolute monarchies to modern
centralized welfare-warfare state mass democracies to the current
foundations being laid for a future global government. Hoppe regards this
as an ominous trend leading to universal statism and the destruction of
liberty and prosperity.

Essential to Hoppe's
thesis is the concept of "time-preference" which is used as a
means of describing the degree to which a person prefers instant or
delayed gratification. Someone with a "high" time-preference
values instant gratification to a larger degree and is less willing to
forgo immediate pursuit of pleasures or consumption of goods for the sake
of some future goal like savings, investment, health, maintaining
resources for unforeseen disasters, etc. Likewise, someone with a
"low" time-preference is more willing to endure short-term
sacrifices for the sake of some future goal. A person with a
"low" time-preference is "future-oriented". The more
goals one has for the future the more one must work, save, invest, produce
and delay gratification in the present. One must maintain a relatively
high level of self discipline, personal responsibility and cooperation
with others in the process. Consequently, in a society where overall
time-preferences are low the general level of productivity,
responsibility, cooperation and civility will be high.

Hoppe describes
government as having the social effect of raising time-preferences and
reducing expectations for delayed gratification. Government is
characterized as having essentially the same effect on society as natural
disasters or crime. Both natural disasters such as floods and earthquakes
and crimes such robbery and theft diminish the individual's immediate
supply of goods thereby raising time-preferences and reducing the amount
of resources available for allocation toward future goals. Government
achieves a similar effect through its activities of taxing the resources
accumulated by the individual, devaluing the unit of exchange
("money") through inflationary monetary policies and restricting
the use of resources through regulations and prohibitions. All of this
serves to reduce the overall level of productivity and cooperation by
reducing the supply of goods available for savings, investment and
exchange. Indeed, government is described as having a worse effect on
these values than natural disasters or crime as government aggression
against and confiscation of individual resources is continuous and ongoing
while natural disasters and crime are sporadic and temporary.

The concept of
time-preference is used by Hoppe to compare and contrast the effects of
monarchical and democratic governments on society, respectively. Hoppe
argues that a monarchical ruler will typically have a lower
time-preference and be more future oriented than democratically elected
rulers and that the policies enacted by a monarch will typically inspire
the general population to more salutary behavior than those implemented by
a democratic government. Under a monarchy, the nation is considered the
personal property of the king. The nation is then added to the monarch's
own personal estate. Naturally, the monarch wishes to improve the value of
and maintain the quality of his estate and the prosperity of his estate is
connected to the prosperity of the nation as a whole. The monarch also
wishes to increase the wealth of the nation for the sake of his posterity
and his legacy. A monarch will not wish to tax his subjects to the degree
that overall productivity declines and the wealth of the nation, and
therefore the monarch's personal and family wealth, decreases. On the
other hand, democratic rulers are merely the trustee managers of publicly
owned resources. They cannot use these resources once they leave office
nor can they bequeath public resources to their offspring. Therefore, the
incentive is great to consume in the present with no regard for the
future. Also, the higher taxes are at the present time the more resources
will be available for democratic rulers to make use of. The long-term
effects of such taxation on wealth creation are irrelevant to politicians
whose position is temporary. Similarly, as democratic rulers are not
personally liable for debts that they incur, but may instead pass such
debts on to future generations of taxpayers, there is no incentive for
frugality in the present while there is every incentive for wastefulness
and improvidence. This explains why taxes and public debts are much higher
under democratic governments than under monarchical ones.

Democracy is described by
Hoppe as providing incentive towards irresponsible and predatory behavior
among both the political class and the general population. A monarch
achieves his position by inheriting it. The question of what the character
of a particular monarch will be is largely a roll of the dice. A monarch
may be a vicious predator, a harmless mediocrity or perhaps even a
relatively competent and fair-minded individual. Democratic rulers, on the
other hand, come to power largely on the basis of selling themselves to
voters. To be effective at this, a successful politician must be, for the
most part, an unscrupulous demagogue. Democratic politicians typically
acquire a following for themselves by promising to repress or plunder
rival economic or cultural groups for the benefit of their own supporters.
Under a democracy, the life, liberty and property of every individual
comes up for grabs by everyone at every election. Shifting coalitions of
oligopolistic special interests and unconstrained popular majorities form
who constantly square off against one another. A situation is created
where A and B conspire against C, B and C conspire against A, C and A
conspire against B. Democracy becomes merely a substitute for an all-out
multiple factioned civil war. The overall moral quality of society
degenerates into a war of each against all. Also, the constant plundering
and repression of some for the benefit of others decreases the
productivity of those being attacked and simultaneously increases the
dependency, unproductiveness, infantilization and irresponsibility of
those being subsidized with the fruits of the plunder. The general trend
in society will be one of decreased productivity and increased crime,
recklessness and incivility. Hoppe demonstrates that this trend is
currently being played out in Western, particularly American,
civilization.

Democracy damages society
in other ways. Under a monarchy, there is a clear distinction between the
rulers and subjects. Entry into government is typically limited to the
royal family and perhaps a few associates and business partners. Under a
democracy, the government is ostensibly composed of "everyone"
and is "of the people". Elected officials are "the people's
representatives". State policy is "the will of the people"
and so forth. By perceiving themselves as somehow magically practicing
self-rule, there is a decrease in "class consciousness" among
the subjects and therefore less popular objection and resistance to taxes,
legislation, public debt and even war. Indeed, wars waged by democratic
governments tend to be particularly destructive. Monarchical wars are
typically fought for the acquisition of territory by the rulers. The
public recognizes this and is resistant to participation in such wars.
Consequently, popular opinion limits the ability of the monarch to impose
taxation or conscription for the purpose of prosecuting the war effort.
Democratic wars, on the other hand, tend to be ideological wars. Wars are
fought "to make the world safe for democracy", "to defeat
godless communism", to turn back the "yellow peril" or the
"red horde", to "rid the world of want and fear" or
"to eliminate terrorism". Hence, the entire resources of a
nation are mobilized for the sake of the war effort. Citizens view
themselves as fighting for their "country" rather than for their
government or ruling class. Such wars become "total" wars. The
goal becomes the complete annihilation of the enemy rather than the mere
acquisition of territory. The distinction between combatants and
non-combatants is diminished. Unconditional surrender becomes the
overriding military objective. Methods of territorial acquisition and the
handling of foreign policy disputes available under a monarchy, such as
marriage or contract, are unavailable to a democratic state. Therefore,
foreign policy is organized primarily on the basis of violence.

Hoppe points out that
until the commencement of the First World War in 1914, only a handful of
Western nations were democracies-America, France, Switzerland and,
nominally, England and the Netherlands. All other European nations were
monarchies. Since 1914, monarchy has completely disappeared in favor of
universal democratization. The subsequent century has seen a massive
growth of government, bureaucratic proliferation, increasingly brutal and
all-encompassing wars, exorbitant taxation, inflation and currency
devaluation, centralization of government, the accumulation of enormous
public debts, a breakdown of family and community solidarity, increased
mediocrity among the intellectual classes, the rise of totalitarian
ideologies such as communism and fascism and an overall increase in crime,
economic dependency on the state, personal irresponsibility and ethnic and
cultural strife. Hoppe's prognosis for the future of Western civilization
is not pleasant. Mounting public debts, ever increasing state obligations
for social insurance payments, increasingly exorbitant health care costs,
currency destabilization and tax burdens are leading towards a likely
economic meltdown. The ongoing tendency towards world government,
increased ethnic strife and attacks on traditional liberties, ever
expanding social pathologies and perpetual international warfare can only
lead to tyranny, societal disintegration and eventual civilizational
collapse.

As for efforts to reverse
this alarming trend, Hoppe insists that the first order of business is to
scrap the idea that the power of government, particularly democratic
government, can ever be genuinely limited, whether by a written
constitution or otherwise. The principle flaw in schemes for limiting the
power of government is that legal and constitutional provisions for such
limitations are to be interpreted and applied by agents of the state,
namely, judges and lawyers, who possess a powerful self-interest in the
expansion of the state. In other words, under a limited government the
state is to police and regulate itself. The mice are to guard the cheese
and the foxes are to guard the chickens. In Hoppe's view, the primary
error of classical liberalism was its acceptance of the idea of the state
as a necessary evil, rather than as an unnecessary one.

Hoppe favors elimination
of the state completely in favor of a system commonly referred to as
"anarcho-capitalism" which he alternately describes as
"private property anarchy", "natural order" or
"private law society". Under such arrangements, all government
functions would be privatized including police, courts, streets and
defense. The state's armed forces would be dismantled in favor of private
mercenaries, militias and guerillas. The state's monopolistic judicial
system would be eliminated in favor of competing arbitration agencies.
Government-run police forces would be abolished and private police
services would operate on the basis of fee-for-service or private
contractual agreements. The construction and maintenance of streets and
roads would be the prerogative of private companies. All taxation and legislation
would be abolished. As for the question of how such a system is to be
achieved, Hoppe advocates the building of localized secession movements
which would simultaneously work to secure complete independence for their
area. The result would be the proliferation of numerous city-states and
sovereign territories akin to present day Liechtenstein, Monaco, San
Marino, Hong Kong or Singapore. These new political units would then
privatize all government functions and effectively abolish the state.

Professor Hoppe has made
a monumental contribution to the world of political philosophy. This work
is the first serious effort to provide a critique of modern statist
"democracy" from an anarchist perspective. Hoppe does not offer
anything particularly new to the anarchist attack on the state in a
general sense. He largely repeats the arguments offered by earlier
anarchists ranging from Godwin to Proudhon to Tolstoy to Rothbard. These
and other writers have recognized that the state is an artificially
privileged exploiter class that seeks to monopolize exploitation within a
particular territorial jurisdiction. Conventional intellectual arguments
used to justify the state such as those derived from "social
contract" theory and "implicit consent" theory have been
thoroughly refuted by Lysander Spooner and others. Hoppe provides no new
insights here. Instead, it is with his attack on democratic states
specifically that Hoppe makes his contribution to the overall development
of anarchist political philosophy. Most people in modern societies
generally recognize the illegitimacy of monarchical, aristocratic,
theocratic, fascist, communist and military states. However, democratic
states are typically thought of as being somehow different from other
types of states and as operating on diametrically opposite principles from
other regimes. Hoppe skillfully refutes this common misperception.

It has become a
commonplace adage among anti-statists that democracy is simply a system
whereby four wolves and a sheep take a vote on what to have for lunch and
then the wolves pat themselves on the back for being so enlightened and
progressive as to take a vote before devouring the sheep. It is a logical
absurdity to equate democracy with freedom in the way that mainstream
political philosophers and commentators typically do. A system where
individuals and minorities are at the mercy of unconstrained majorities
hardly constitutes freedom in any meaningful sense. Still, many
contemporary persons continue to regard freedom and democracy as
synonymous. Indeed, some even equate freedom with merely possessing
suffrage in a multi-party system. Democracy is often invoked to justify
the most heinous state crimes. The tyrannical drug war is sometimes
justified in the name of democracy with the idea being that if the
majority approves then any action against individuals must be acceptable.
Warmongers currently screaming for an all-out American assault on
virtually the entire Muslim world for the sake of advancing Israeli
imperialism often try to justify themselves by claiming Israel is
"democratic" while its neighbors are not. (Actually, Israel is a
racist theocracy.) Military conscription is often justified in the name of
democracy. After all, Switzerland has the draft and they are the world's
most democratic nation, right? Democratic states typically recognize no
limits on their "right" to levy taxes on their subjects with the
rationale being that if "the people" elect the government then
the people must be taxing themselves. Both social democrats and
traditional conservatives appeal to "democracy" to justify
virtually any act of repression ranging from zoning ordinances to gun
control legislation to censorship to eminent domain to asset forfeiture
laws.

Anarchists, libertarians
and, indeed, anti-statists of any stripe must recognize that the abolition
of the state is a profoundly un-democratic project as far as modern
statist conceptions of democracy are concerned. The political battles of
the future will not be between leftists and rightists or liberals and
conservatives but between anti-statists and their democratic statist
enemies. It is at this point that the meanings of the various types of
"democracy" need to be clarified. Democracy may indeed be a
wonderful way of operating a voluntary organization or community like a
labor union, a cooperative, a neighborhood association, a church or a
birdwatchers' club. However, to operate the coercive apparatus of the
state as a "democracy" is to invite disaster. Democratic statism
simply provides a popular majoritarian cover to whatever actions are
carried out by interest groups currently in control of the state who wish
to repress or plunder their economic, cultural or ideological competitors.

Often, left-anarchists
and anarcho-socialists will present themselves as champions of
"direct democracy", "consensus democracy" or
"participatory democracy". However, this type of democracy is
fundamentally different from the centralized, authoritarian, special
interest/party politics variety of "democracy" on which modern
states are organized. Essential principles of any genuine democracy are
voluntarism and decentralization. Membership in participatory democratic
communities must be voluntary. The rules and norms of such communities
must be consensual in nature. Minorities must not be coercively bound by
majoritarian preferences and such communities must be small enough for
direct face-to-face deliberation to take place and for dissenters to
migrate if they so desire. As an anarcho-capitalist, Hoppe seems to oppose
democratic institutions of any type, voluntary or otherwise. Yet, Hoppe's
model of an anarchical system is a decentralized collection of private,
voluntary communities governing themselves according to their own
contractually agreed upon rules. His ideal model of social organization is
relatively similar to that employed by shopping malls, planned residential
communities and traditional "company towns". But there is no
reason why voluntary communities could not form on the principle of either
individual private property ownership or voluntary communal ownership and
manage themselves in a manner similar to historic New England town
meetings.

One flaw in Hoppe's
analysis is his failure to differentiate as thoroughly as necessary
between the republican ideal of classical liberalism and the
all-encompassing centralized statism of modern "democracy".
Hoppe regards classical liberal republicanism largely as an initial phase
of the conversion from monarchy to democracy. He sees modern democracy as
an outgrowth of republicanism. This perspective seems woefully inadequate.
Classical liberalism arose in the eighteenth century as an antidote to the
tyranny of the Ancien Regime. The solution to the problems of the Old
Order was to be the establishment of a decentralized, confederal republic
ordered on the principles of inalienable individual rights,
constitutionally limited government and wide separation of powers, both
vertically and horizontally. Democracy was to be used merely for
administrative purposes within a larger framework of severely limited
governmental power. This system, which found its purest expression in the
American Revolution, is the diametrical opposite of the authoritarian,
centralized, bureaucratic, unconstrained, special interest,
state-corporate, welfare-warfare mass democratic states of the modern era.
Modern states are not an outgrowth of but a specific repudiation and
overthrow of the classical liberal republican ideal.

The pertinent question
involves the matter of what forces brought about the demise of
republicanism. Hoppe attributes the growth of the modern state to the
monopolistic legal order of a constitutional state whereby the
constitution is to be enforced by an arm of government, the extension of
the franchise and the subsequent creation of more and more interest groups
looking to feed at the state's trough and the natural tendency of
government to expand over time. However, the initial expansion of statism
largely came about as a result of the growth of business corporations and
the seizure of power by these corporations. Classical liberal thinkers
like Adam Smith and Thomas Jefferson predicted that if the then-nascent
corporate class was to continually grow in power and influence the result
would be the subversion and destruction of the republican system. The
creation of the U.S. constitutional system was in and of itself a coup
against the more decentralized and libertarian Articles of Confederation
by northeastern banking and mercantile interests led by the likes of
Alexander Hamilton who preferred a stronger central government for the
advancement of commercial interests. The consolidation of federal power
over the states in the American Civil War was largely the result of the
seizure of the federal government by northern industrial capitalist
interests led by Abraham Lincoln who wished to suppress their southern
feudal competitors and subordinate the south as an economic colony. The
further growth of the state in the late nineteenth century was primarily
rooted in the mercantilist ambitions of early "big business"
leaders of the robber baron period.

Since the beginning of
the twentieth century, capitalist corporations have been central to
statist expansion during the Progressive era, the First World War, the
Depression and the New Deal era, the Second World War, the Cold War, the
Great Society, 1980s Reaganite military socialism and, now, the current
laying of the foundations for a global corporate state via the World Trade
Organization, International Monetary Fund, the World Bank, NAFTA, etc. As
a staunch economic conservative, Hoppe is loathe to fully recognize the
role of capitalist power in the fostering of statism. However, any serious
attack on the state must necessarily include an attack on corporate power
as well. While it is true that business corporations operating on a purely
contractual basis could be among the many different types of economic
organizations that could exist in a stateless economy, the present U.S.
corporate system rests heavily on state intervention and many contemporary
economic elites have attained their positions as a result of the
infrastructure created by corporate statism. The collapse of the U.S.
regime would mean the simultaneous collapse of the corporate structure as
well. The matter of what will come afterward is the next question needing
an answer.

Hoppe is also a very
reactionary cultural conservative and his comments denouncing
"democrats, socialists, multiculturalists, counterculturalists and
alternative lifestylists" are reminiscent of Stalinist diatribes
against "Trotskyites, social democrats, petty bourgeois anarchists,
rootless cosmopolitans and bourgeois degenerates". Similarly, Hoppe's
anti-immigration hysteria comes perilously close to resembling the
rhetoric of xenophobes and nativists raving about "mongrel
hordes". Nonetheless, Hoppe raises some interesting questions even on
these points. Anarchists and libertarians frequently assume that the end
of centralized monopoly government will automatically usher in the reign
of a new millennium of freedom and tolerance. However, anarchism merely
implies the existence of a social order based on the principle of
voluntary association. Questions of property relations are irrelevant at
this point. The division between private and communal property is not as
clear as some seem to believe. On one hand, ALL property is private to
some degree. State-owned property is, for all practical purposes, the
private property of the state. Communal property is the private property
of the commune. Likewise, many forms of "private" property are
owned collectively in some way. Corporations are owned collectively by
investors, shareholders and managers. Family property is owned
collectively by husbands, wives and heirs. The anarcho-socialist vision of
decentralized communes and federations of workers' syndicates implies that
the communes and syndicates will be the collectively owned private
property of the workers and communities. Presumably, these units would be
able to establish whatever types of internal rules and regulations they
wished and exclude those who did not comply or who were not wanted. The
same would obviously be true of the privately owned institutions such as
schools or businesses that are favored by free-market libertarians. In an
anarchist system, there would be no federal regulatory bureaucracy
enforcing "civil rights", "anti-discrimination" or
other forms of egalitarian legislation. Consequently, private communities
controlled by the Nation of Islam would be able to exclude whites and
Jews, businesses controlled by the Aryan Nations would be able to exclude
blacks and Jews, Christian educational institutions would be able to
exclude homosexuals and atheists, Jewish institutions would exclude Nazis
and so on. Landlords could refuse to rent to tenants whose looks they did
not like and employers could "discriminate" on any basis they
desired. Even if the anarcho-socialist vision of an economy where all
rental housing and industry is owned cooperatively by the tenants and
workers was to be fully implemented, it is likely that Jewish housing
cooperatives would deny admittance to raving anti-Semites and that workers
cooperatives would refuse to take in lazy, obnoxious parasites. All of
this would be perfectly "legal" and permissible in an anarchist
order unless some higher political authority said otherwise in which case
the state would have re-emerged.

Hoppe argues that the
level of discrimination would increase markedly in a stateless society.
Libertarians have often been perplexed by the question of
"authoritarian cultures". What about those people and groups
that simply do not desire liberty for either themselves or others? The
venerable anarchist tradition of decentralization represents the best way
out of this dilemma. In a system of small, localized, self-managed
communities, persons who chafed under the norms of their community of
origin would be able to migrate towards an environment that was hopefully
more hospitable. Migration as a seriously viable option has long been
demonstrated to be the best protector of individual liberty rather than
centralized governments and state courts enforcing legislated "civil
rights", "due process", "constitutional rights"
and other arbitrary and vaguely defined concepts that are easily ignored
or repealed.

The utility of
decentralization also gives additional weight to Hoppe's preferred
strategy of revolution by secession of small groups. The best bet for
smashing Leviathan seems to be the building of separatist movements at the
local and regional level. There are already a good number of small but
growing groups of this type in the United States-the League of the South,
Republic of Texas, the New England Confederation, Alaskan Independence
Party, the Green Panthers and others. If these and other groups of this
type were to grow and begin supporting one another a full-on assault on
the state would be underway. These movements could support one another
even when they are geographically separated or even ideologically opposed.
In the southern states, for example, rural conservatives and populists
could agitate for "states' rights" or "county
supremacy" while black nationalists and separatists could demand
separate municipalities for predominately black communities in urban
areas. Anarcho-socialists in Vermont or Oregon could align themselves with
lassez faireists in Kansas or Texas. Small town Christian fundamentalists
could align themselves with anarcha-feminist lesbian separatists in San
Francisco. Most of the decentralist, libertarian and anti-state groups in
the U.S. have yet to consider the opportunities that such alliances might
generate. The rallying cry should be "Secessionists Unite!".
After all, this is what made the first American Revolution. Perhaps it
will be the basis of a second American Revolution as well.